(Bloomberg) -- A group of Kaisa Group Holdings Ltd. bondholders have sent the company a formal forbearance proposal, designed to buy the beleaguered developer some time and avoid a default. 

The creditor group, which is being advised by Lazard Ltd., sent the offer to Kaisa on Monday evening in Hong Kong, according to two people familiar with the matter. Kaisa declined to comment on the proposal.

The proposal would see the company avoid a formal default on $400 million dollar bonds due Tuesday, and get more time to seek potential solutions. Discussions include a so-called new money deal that would inject cash into the ailing property firm, the people said. The group holds Kaisa notes with a face value of about $5 billion, they said.

Like fellow troubled developer China Evergrande Group, Kaisa was a frequent borrower in the offshore market with some $11.6 billion of dollar notes outstanding, even as it ranks just 27th among China’s property developer by sales. The firm last week failed to secure bondholder approval for a debt swap.

Defaults in China’s real estate sector have eased since regulators told firms in late October to honor offshore debt obligations, following at least four failed payments earlier that month. Even so, the country’s borrowers have defaulted on a record $10.2 billion of offshore bonds in 2021, with real estate firms making up 36% of that total, according to data compiled by Bloomberg. 

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